Posts Tagged : Office leasing

With supply scarce, Doral offices are 91% full, prices rising

With supply scarce, Doral offices are 91% full, prices rising

Week of Thursday, August 3, 2017

By Katherine Lackner

Codina Partners build 8333 Downtown and has three more office buildings on the way in a tight market.

With scare supply and no new product in the pipeline, the Doral office market continues to be robust, observers say.

“Institutional capital now accepts that Doral is a mature, exciting and deep market, and one they want to be in,” said Doug Okun, Senior Vice President at CREC. “It’s become a first-class city.”

The new residential stock “is a driver,” he said, as are the ever-increasing amenities, including retail, schools, restaurants and infrastructure. Most buildings offer plentiful parking, which is not the case in urban markets or even some suburban markets, he said.

With about a 91% occupancy, pressure is being put on lease prices and concessions are becoming rarer, he said. Space in a class A building can fetch $40 per square foot, “which was hard to image five or 10 years ago,” Mr. Okun said. Class B space leases in the high $20s or low $30s per square foot, he said.

Most developers consider mixed-use projects or residential units to be the highest and best use for their land, he said. That, combined with high construction costs, suggest that the dearth of new office buildings will continue, further driving up demand for existing space.

“I remain bullish on the Doral office market,” Mr. Okun said. “I think it will continue to get better, and almost every data point supports that.”

“We are witnessing Doral become more of an urbanized environment,” said Ericka Witkowski, associate with Avison Young. “The ‘live-work-play’ play dynamic, in addition to the already acclaimed economic benefits of leasing in Doral, is really creating the ideal ambience that attracts major corporate headquarters. That will continue to grow this submarket. Doral continues to be one of the most sought-after markets in South Florida, which is attested to by a less-than-9% vacancy rate.”

“County-wide year-to-date leasing activity remains up 6% year-on-year, driven to a notable degree by non-CBD submarkets that had been unsettlingly quiet through 2016,” said JLL’s second-quarter 2017 office market report. One of the larger deals inked that quarter was the Everest Business Funding lease of 27,000 square feet in Downtown Doral, the report noted, but, on the whole, transactions were smaller.

JLL lumps Doral into the Miami Airport submarket, where rents overall are $30 per square foot and vacancy is 9%, according to the report. Class A space in that submarket can be had for $33 per square foot (and the vacancy rate is 8%), while class B space leases for $27 per square foot and the vacancy rate is 11%, the report said.

Miami Beach office market in ‘very best of health right now’

May 18th, 2017

By Catherine Lackner

S.Hurwitz_CREC_2016Miami Beach, a small, boutique office market, is “phenomenal as an asset class and arguable in the very best of health right now,” said Stephen Rutchik, Colliers International executive Vice President.

With no new office product introduced since 2002 and exploding values that make residential and mixed-used projects the highest and best use for raw land, tenants are shopping around in existing spaces and landlords are re-investing in older buildings, he said.

“There’s been a very significant appreciation in rents,” he said. “We’re still at a discount to the central business district, but not as much as before.” Class A rents in downtown Miami are about $45-$50 per square foot gross, while that space can be had on Miami Beach in the mid-$40s, he said.

“Many employers are looking for a submarket that has all the amenities their employees want as well as places to entertain clients. Miami Beach provides that and it’s not horribly congested like the CBD. It also has that cool factor, like Wynwood,” which doesn’t have much in the way of pure office space, observers say.

On Miami Beach, a higher proportion of people get around on bikes, skateboard and scooters than on the mainland, which is appealing to the millennial who work for or own tech companies, Mr. Rutchik said. “Tech firms are the drivers of net absorption. Being on Miami Beach checks their boxes.”

“We are seeing that the Miami Beach office market is currently performing quite well, with several similarities to other South Florida boutique office markets, such as Aventura and South Miami,” said Steven Hurwitz, a partner at CREC who leads the firm’s office leasing practice, via email.

“They provide a wide range of high-end, close-to-home opportunities for professionals wanting to avoid the ever-growing traffic congestion in South Florida. In Miami Beach, calls A vacancy remains in the single digits, and rental rates continue to climb, with supply constraints and limited, to no new deliveries on the drawing board.

“Land values and the return on other asset classes – like residential, retail and hospitality – have made Miami Beach’s office supply flat for many years. It is highly unlikely you will see an institutional-quality office building being delivered in South Beach anytime in the near future,” he said.

Miami Beach tenants are typically middle- to high-net-worth decision-makers, the fund and investment managers, principals in music and talent agencies and others who don’t typically need to be downtown, he said.

“Compass (a new tenant to Miami Beach) took the top two floors at the old Sony Building at 605 Lincoln Road in the past year and Warner extended its lease last year and is staying on Miami Beach, so that’s also good news for the market,” Mr. Hurwitz said. “Miami Beach tenants are those that want great quality in a location outside the more congested downtown and Brickell markets. Many of them live on Miami Beach, as do their employees.”

“Miami-Dade County’s pace of total office leasing activity bounced back from a tepid showing in 2016 with little adjustment to near-record high asking rate,” said JLL’s first quarter 2017 office report.

“Countywide total leasing activity registered 40% year-on-year growth (representing the largest single-quarter square-footage leased since the fourth quarter of 2015), led by the long-awaited return of suburban submarkets to long-term historical average activity.”

Miami Beach is a relatively small market with 1.9 million square feet of office space, the report continued. Throughout the Beach, rents average $41 per square foot, and the vacancy rate is 9%. Miami Beach class A space fetches $45 per square foot (with an 8% vacancy), while rates for class B are $39 per square foot with a 9% vacancy.

CREC Tapped To Exclusively Lease 43,000 SF Of Retail Space For Luxury Mixed-Use Development In Downtown Miami

May 16th, 2017

CREC has been appointed the exclusive leasing agent for 43,301 square feet of prime retail space of the luxury mixed-used development Vizcayne, located at 200 Biscayne Boulevard, in the heart of downtown Miami.

Vizcayne is situated within walking to distance to the American Airlines Arena, in a dense urban area with a strong population of businesses and growing residential base. Comprised of 849 condominium units in two residential towers, the development’s retail space provides everyday conveniences and services that appeal to the surrounding demographic.

Current ground-floor tenants include Orangetheory Fitness, CVS, Smoothie King, Zona Fresca, and The Learning Experience, with available retail space between 2,875 and 13,047 square feet. Additionally, Vizcayne offers a 126-space parking deck and abundant street parking along Biscayne Boulevard and adjacent side streets.

CREC Vice President Rafael Romero, CCIM and Senior Leasing Associate Ariel Bernstein will oversee leasing and marketing of the project.

“Vizcayne’s retail component provides a unique opportunity to attract lifestyle tenants that complement the neighborhood’s thriving residential base, as well as the bustling business community,” said Romero. “We are carefully selecting a retail mix that heightens the amenities of the luxury mixed-use development, while remaining conscious of drawing retailers that deliver a sense of ease to those who regularly frequent the area.”

Strategically located on Biscayne Boulevard, Vizcayne is across from Bayside Marketplace and Bayfront Park. Developed by Cabi Developers, the projected was designed by Fullerton-Diaz Architects, Inc. and completed in 2008.

“We are excited to add another luxury mixed-use project to our portfolio, and look forward to curating a lifestyle retail mix that brings great value to Vizcayne and Downtown Miami’s thriving pedestrian market,” added CREC President and Co-Founder Carol Greenberg Brooks.

CREC Tapped to Manage, Lease Miami Office Building

April 5th, 2017

CREC has been selected as the exclusive leasing agent and will be managing the office asset for Park Centre Boulevard in Miami Gardens.

The ‘Class A’ office building was acquired for $8.5 million in February by 1111 PCB Holdings, LLC.

Located at 1111 Park Centre Boulevard, the property offers 56,634 square feet of office space amidst four stories. The building is currently 92-percent occupied, with 5,162 square feet of rentable space available. CREC Senior Leasing Associates Katie Fernandez-Espinosa and Teri Jarp will oversee leasing.

“We are excited to be collaborating with the new ownership team for Park Centre Boulevard to bring this asset to full occupancy,” said CREC Co-founder and President Carol Brooks. “The property is currently home to a strong mix of professional tenants, including law offices, medical companies and government agencies, seeking convenient workspaces in proximity to major thoroughfares. The location, coupled with the building’s on-site amenities, will serve as a strong draw for our network.”

Park Centre is  situated west of the Golden Glades Interchange.